TESCO's Digital Transformation
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Case Code: BSTR472 Case Length: 14 Pages Period: 1919 - 2014 Pub Date: 2015 Teaching Note: Available |
Price: Rs.400 Organization: Tesco Plc. Industry: Retail Industry Countries: United Kingdom Themes: Business Transformation, Online, Digital Marketing and Retailing |
Abstract Case Intro 1 Case Intro 2 Excerpts
Background
Jack Cohen (Cohen) left his job at Royal Flying Corporation and started his own business in the year 1919. He sold groceries from a store at East End in London. On day 1, the sales were £4 and the profit was £1. In the year 1923, Cohen partnered with a tea merchant, Thomas Edward Stockwell (TES), to sell their first own branded product called Tesco tea (The name Tesco was derived from the first letters of the tea merchant's name and from the first two letters of Jack's surname Cohen). Following this, Cohen opened an independent grocery store at Burnt Oak, Edgware, North London, in the year 1929 and named it TESCO stores.
Cohen operated his business as a Private Limited Company and converted it into a Public Limited Company in the year 1947 by listing its stock on the London Stock Exchange at a share price of 25 pence. Cohen expanded his business through acquisitions and by adding new stores. During the
1950s and 1960s, he acquired a large number of retail and grocery stores in the UK. Tesco's stores were large and offered huge quantities of products. Its store at Leicester entered the Guinness book of records for being the largest store in terms of quantity of products and size of the store. Cohen introduced the concept of Supermarkets and Superstores in the UK. He also introduced the concept of self-service stores. In 1958, Tesco started to sell non-grocery items like electronics and clothing.
In the year 1963, Cohen introduced Green Shield Stamps (GSS). GSS was a kind of Trading stamp introduced by the Green Shield Trading Stamp Company (GSTSC). Tesco associated with GSTSC and introduced GSS through its check-out points. Customers were given stamps based on their purchases and they collected these and stuck them in a book. Once the book was filled up, they exchanged it for a gift offered by Tesco and GSTSC. This strategy mainly served as a loyalty scheme and was also helpful in improving Tesco's sales and enhancing its reputation in the market.....
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